The Economic Case for Mass Migration has Finally Collapsed

The supposed economic case for mass immigration has finally collapsed, writes Sam Ashworth-Hayes in the Telegraph, as a new report from the Institute for Fiscal Studies confirms what many have been saying for decades: bringing in millions of low-pay workers and their families can never make a country richer. Here’s an excerpt.

It was a delightful theory. Opening Britain’s borders would bring an influx of human capital that would leave the country richer, the tax burden lower, public services stronger and our culture enriched. And, as a theory, it had the great benefit of being all but impossible to falsify unless someone was daft enough to actually try it in practice.

Unfortunately, thanks to the Conservatives, this has now happened. And the resulting confrontation with reality has demolished a truly beautiful idea. Report after report, dataset after dataset, is hammering home a simple message: mass migration is not making Britain better off.

The latest entry in the list has taken a sledgehammer to the argument that immigration is desperately needed to prop up our crumbling public services.

As the Institute for Fiscal Studies argues, the “fiscal headroom” generated by immigration is largely illusory. Rather than the result of carefully selecting for high income, low-cost arrivals, it has rather more to do with the way the Office for Budget Responsibility comes up with its figures – plugging in spending plans that don’t account for the greater demands of a larger population. Once this is factored in, the migration dividend dissipates.

This shouldn’t be surprising. Even before the Conservatives reshaped the immigration system to bring in huge numbers of care workers and “students”, study after study showed that non-EU migrants were a significant fiscal drain.

This is as much about the generosity of the British state as it is anything else; the average U.K. citizen receives more in public services than they pay in taxes. But it does mean that in order for migrants to pay their way, they need to earn very high wages or leave after their working years. Unsurprisingly, many don’t.

The problems don’t end there. Adding more people to an economy will almost always make it larger, but that doesn’t mean it makes the people already here better off. Britain has a serious shortage of housing, congested infrastructure, and increasing conflict between communities with radically different visions of what the country should be. Adding in large numbers of people from around the world does very little to improve any of this, and makes much of it actively worse.

Let me get this straight. When the Office for Budget Responsibility told us that immigration makes us better off, it failed to account for the public spending on the migrants and their families. That’s a weird kind of budget responsibility. Funnily enough, I’ve found that getting a new Ferrari would make me better off, if you just ignore what I’d spend on it. You can’t make this stuff up.

Worth reading in full.